Coca-Cola To Capitalise On Growth Oportunities In Ghana.
The Coca-Cola Company, the world’s leading non-alcoholic beverage producer says it will not only continue to invest to take advantage of the growing opportunities in emerging markets but will also assist in building sustainable communities in these markets.
The company is particularly pleased with the opportunities for growth and community development in the nine West African countries that its subsidiary office, Coca-Cola Equatorial Africa Limited, manages from Ghana.
“Globally, six out of the top 10 growth markets over the past few years have been in Africa. Ghana happens to be one of the top six with an emerging middle class. We see tremendous opportunities in Ghana and we will continue to expand and tailor our products to meet the lifestyle needs of our consumers”, said Mr. Reiner Becker, General Manager of Coca-Cola Equatorial Africa Limited.
The Coca-Cola system in Ghana is made up of Coca-Cola Equatorial Africa Limited and its franchised bottling partner, The Coca-Cola Bottling Company of Ghana (TCCBCG). The Coca-Cola Ghana system’s aim is to continue to expand its product offerings to become a total non-alcoholic beverage business.
Currently, in addition to its well-known sparkling brands that include Coca-Cola, Coca-Cola Light, Fanta, Sprite, Scheweppes and Krest, the company also produces Minute Maid juices, Bon Aqua water, Burn energy drinks and Schweppes malt.
In an interview with Graphic Business, Mr. Becker said the Coca-Cola system has contributed to the socio-economic development of Ghana since it started operating here through its franchised bottler in 1956. ‘We believe we are one of the largest economic growth engines of this economy. For every job that we create, we estimate that there are an additional 10 jobs that are created as a result of our supply chain linkages. It is clearly evident from the large number of enterprises that distribute and sell our products all over the country’.
The company believes there are still opportunities to continue to expand its supply chain linkages to the youth, females and small businesses. The company has a large number of micro-distributors who deliver products to outlets throughout the country. It estimates that about 90 per cent of these micro-distributors are actually owned and operated by women. In some cases, these women are the sole bread winners for their families. This is in line with The Coca-Cola Company’s global ambition to empower an additional five million women by 2020 by using its supply chain.
In addition to female empowerment, the company has programmes focused on developing the youth, providing access to safe, clean drinking water and improved sanitation facilities, improving the educational system and providing healthcare assistance for communities throughout Ghana.
To support the development of the youth, The Coca-Cola system provides financial assistance and guidance to a number of youth development organisations including Students in Free Enterprise (SIFE), Junior Achievement, Play soccer, The Zawadi Africa Education Fund for females and United Way.
The cornerstone of its youth development programme is the hiring and training of about 150 national service personnel every year. This programme which was started in 2007, trains recent college and polytechnic graduates in sales and marketing by having them work directly with Coca-Cola field personnel throughout the country.
The service personnel are trained to solve everyday problems that occur in the business and are exposed to the work ethic required to be a successful employee in a world-class global enterprise. Some of the personnel are offered an opportunity to work for The Coca-Cola system after their service periods end and the rest are released as skilled graduates into the Ghanaian workforce.
In education, the Coca-Cola system has invested in improving the infrastructure in schools and providing tools that aid in the instruction of students. In improving infrastructure, the company has built classroom facilities for schools in the Northern, Volta, Ashanti, Brong Ahafo and Eastern regions of Ghana.
The latest was a six classroom block with a kitchen, a dining facility and a rain water harvesting system for Guunayili Primary school near Tamale. In the area of tools, Mr. Becker remarked that ‘The Coca-Cola system is pleased with the partnership it has with The Discovery Channel Global Education Programme where we are bringing lessons to life in an innovative and interactive way with videos in 25 schools in Greater Accra and Kumasi’.
This partnership he said would soon be expanded to cover a total of 40 schools. It has really improved the teaching environment in the schools. For example, when students were asked to assess their capabilities in four subjects – science, mathematics, English, and social studies/citizenship education – the index score for the Learning Center schools showed a statistically significant positive increase for all of them, an improvement not found in non-Learning Center schools. Mr. Becker said ‘These are remarkable gains considering the challenges facing the communities served by the project’.
The Coca-Cola system is also working with a number of partners to prevent diseases and improve health care delivery to communities. Coca-Cola works closely with Nets-for-life to support the distribution of long lasting insecticide treated mosquito nets throughout the country. Mr Becker said last year, along with other donor partners, the company supported the distribution of over one million mosquito nets to communities in Ghana and also supported a programmeto educate people about the dangers of malaria and how the nets can help with prevention.
“This is an important initiative the company has been involved in since 2006.”, he stated. Working with Medshare, an US based NGO, The Coca-Cola system delivered medical supplies and equipment worth about $1m to the Ghana Health Service in 2011.
The Coca-Cola system’s flagship programme is in Water and Sanitation. Over the last three years, the company has been involved in a partnership with USAID to provide access to safe, clean drinking to five communities in Greater Accra and the Volta regions. With this partnership, Coca-Cola and USAID also plan to provide nine toilet facilities equipped with rain water harvesting systems to seven institutions and build 227 household toilets. Some of the toilet facilities will generate biogas to be used for cooking meals for pupils in the school feeding program.
The cornerstone of the water and sanitation programme is the Safe Water for Africa (SWA) partnership between The Coca-Cola Company, Diageo (Guinness in Ghana and Nigeria), Waterhealth International, the IFC and the Coca-Cola Bottlers in Ghana and Nigeria to raise $20m to provide access for up to 2 million West Africans in Ghana, Nigeria, Liberia and S. Leone by 2013.
SWA will implement the innovative small scale water treatment and distribution facility designed by WaterHealth International. Mr. Becker remarked that ‘The WaterHealth system treats surface water to WHO standards and distributes the water in communities for a usage fee. The usage fee is then used to sustain the operation and maintenance of the system. The water produced by this system is as clean and safe as water produced from any effective large scale municipal treatment system anywhere in the world. The partnership has already built 11 in Ghana and plans to build a total of 50 by 2013’.
Mr. Becker said “We believe in giving back to the communities in which we operate because we know that we will not have a sustainable business without building healthy and economically vibrant communities.”
On the general business itself, he said the company is growing in line with GDP. “GDP growth is obviously very healthy in the country and we are excited about the future of our business here”.
However, he noted that there were some challenges including the recent rapid depreciation of the Cedi. “It was not an easy situation because we buy our raw materials oversees. The depreciation increased our costs in local Cedi terms. To continue to have a viable business we had to recoup part of the increase through a price increase. We are very hopeful that the currency will stabilise and that our business will respond positively”, he said.
The company intends to source some its raw materials in the country in the future and plans to assist develop strong partners who can produce the world class quality products that the company demands. “In some markets where we are in the juice business for example, we are able to source juice locally. We are willing to devote some resources to develop partners with the right capability here as well”.